With Google Fiber months away from its launch in Austin, competitors are ramping up their Internet speeds and services in preparation for a titan-sized fight over customers.

by Claudia Grisales, McClatchy News Service
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July 14, 2014

When it comes to Internet service, Austin is about to become one of the most competitive markets in the nation.

Google Inc. is still months away from launching its superfast Google Fiber Internet service in Austin, but Google’s competitors are already gearing up for a titan-sized fight over customers by ramping up their own Internet speeds and services.

As the battle heats up, the beneficiaries could be Austin consumers, who will have more options when it comes to Internet and subscription TV services.

“That’s great for the people of Austin,” said Austin City Council Member Laura Morrison, who played a key role in luring Google Fiber to the region. “I think it’s bonus and a benefit for the people of Austin to have choice.”

Google began the Internet arms race in April 2013, when it announced that Austin would be the second U.S. city — after Kansas City— to get its Google Fiber 1 gigabit Internet broadband network. Google Fiber is more than 100 times faster than today’s typical broadband Internet access. At 1 gigabit, a user could download 25 songs in 1 second, a TV show in 3 seconds and a high-definition movie in less than 36 seconds, according to data from AT&T.

Local leaders said landing the service would accelerate the development of new tech companies and help with new broadband services for schools and hospitals and other parts of the city. Google is currently working on the infrastructure for the Google Fiber service. Last week, an American-Statesman review of hundreds of city-issued permits found that the search-engine giant is in the midst of installing thousands of feet of cable conduit along 176 city streets – mostly in South Austin and East Austin.

After Google’s announcement that Google Fiber was coming to Austin, the city’s two big established broadband Internet providers, Time Warner Cable and AT&T Inc., said they were ready to make additional investments in their networks as they prepare to compete with the arrival of Google Fiber — and they have done so.

Late last year, AT&T rolled out its fast-growing U-Verse service with its “GigaPower” feature, which offers speeds of up to 300 megabits per second. This year, the San Antonio-based telecom giant said, it plans to up those speeds to 1 gigabit per second.

AT&T said it would double the reach of its Austin area fiber network — already available to thousands of homes — after the “incredible response” to a December rollout of their faster U-Verse product, said Tracy King, AT&T’s vice president of public affairs.

Already, the two companies have faced off in Kansas City, where Google Fiber first launched last year and has taken market share from AT&T, the company said in federal filings.

The filings, which are tied to AT&T’s ongoing efforts to buy DirectTV, say early performance in Kansas City has led experts to predict that Google Fiber will capture the business of at least half of the covered households in three to four years. In Kansas City, the basic price for 1-gigabit Internet access is $70 a month. Internet plus cable TV costs $120 a month. The company also offers a slower basic broadband package free for seven years after a $300 network construction fee is paid.

“Google Fiber is the most ambitious and potentially disruptive BSP,” or fiber-based broadband service provider, the filings said.

“The potential of gigabit Internet has provoked competitive responses from AT&T and other MVPDs (multichannel video programming distributors.) In Austin, four MVPDs now provide broadband Internet speeds of at least 300 mbps,” the filings said.

AT&T has “responded to Google’s planned entry into Austin with competitive offers and advertisements,” the filings said.

Time Warner, meanwhile, also continues to ramp up its fight for customers. The provider began rolling out faster Internet speeds this summer with close to 40 percent of its Austin-area customers — about 100,000 customers — already receiving the new speeds, said Melissa Sorola, director of public relations at Time Warner Cable.

Customers with all six of Time Warner’s Internet service plans are seeing an increase in speeds. For example, Time Warner customers who subscribe to their standard plan are going from to 15 Mbps to 50 Mbps. The move, Sorola said, comes “at no extra charge.”

The first round of boosted speeds were launched in downtown Austin, West Campus and Hyde Park, among other communities.

This month, another 20 percent of Time Warner customers will see new speeds, including Central Texas residents in far South Austin, Lago Vista, Round Rock, Marble Falls and the Bastrop County community of Smithville. In August, another 20 percent will see the new speeds in areas that include San Marcos, Bastrop, Lakeway, and Duval.

By the end of fall, all of Time Warner’s customers will have access to faster Internet speeds, Sorola said.

“Feedback has been positive,” she said. “We’re seeing a steady flow of customers coming in for a new modem (required to get the new service) and …excitement about being able to experience the faster speeds.”

Another local competitor, Grande Communications — a smaller, San Marcos-based service provider — has also boosted speeds, services and plans in recent months.

In February, Grande Communications jumped ahead of Google and AT&T by launching super-fast Internet in West Austin with speeds of up to 1 gigabit.

Grande has said its new Internet service will cost $65 per month with no contract required and the price decreases when the service is bundled with cable TV and home phone service. The Grande service was initially available to about a quarter of the 75,000 homes and businesses in the Austin area that are wired for their service, including the Belmont, Rosedale, Bryker Woods, Pemberton Heights, Tarrytown, Oakmont Heights and Old Enfield neighborhoods.

At the time of the announcement, president Matt Murphy said the bump in speed is, in part, an effort to fend off AT&T and Google.

“There’s a certain sizzle to 1 gigabit that people are excited about, ” he said. “We’re nimble and able to do things faster. We’re consciously doing this to beat Google.”